PSPPROJECT - PSP Projects

📊 NSE: PSPPROJECT 🏢 Construction 📅 Last Updated: 12/14/2025 11:20

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue from operations was INR 2,512.13 Cr in FY25, showing 0% YoY growth compared to INR 2,505.79 Cr in FY24. However, Q2 FY26 showed a 20% YoY increase to INR 694 Cr, driven by improved project execution and labor availability.

Geographic Revenue Split

The order book is highly concentrated with 83% of orders originating from Gujarat and 17% from Uttar Pradesh as of September 2023.

Profitability Margins

Net profit margins (PAT Margin) declined significantly from 4.86% in FY24 to 2.22% in FY25. Return on Net Worth dropped by 65.52% YoY, from 13.55% to 4.67% due to increased construction and finance costs.

EBITDA Margin

Consolidated EBITDA margin contracted from 10.41% in FY24 to 7.14% in FY25, a 327 bps decrease. Q2 FY26 margins showed slight recovery to 6.93% compared to 6.72% in Q2 FY25.

Capital Expenditure

The company incurred a CAPEX of INR 41 Cr during Q2 FY26. The gross block as of September 30, 2025, stood at INR 683 Cr, with a net block of INR 325 Cr.

Credit Rating & Borrowing

CARE Ratings reaffirmed 'CARE A+; Stable' for long-term and 'CARE A1+' for short-term facilities. Interest coverage ratio deteriorated by 37.86% from 4.95x in FY24 to 3.08x in FY25 due to higher interest costs and lower EBIT.

⚙️ Operational Drivers

Raw Materials

Construction materials (including cement, steel, and precast components) represent the primary cost; inventory of construction materials stood at INR 158 Cr as of September 2025.

Import Sources

Materials are primarily sourced within India, specifically from Gujarat and Maharashtra, leveraging in-house resource availability to maintain competitive bidding.

Capacity Expansion

The company operates a precast concrete manufacturing plant near Sanand, Gujarat, with a production capacity of 1 million square feet, established at a cost of INR 109 Cr.

Raw Material Costs

Total operating expenses, driven largely by construction material costs, rose 4% YoY to INR 2,332.70 Cr in FY25 despite flat revenue, squeezing margins.

Manufacturing Efficiency

The precast plant has achieved a significant ramp-up with orders worth INR 181 Cr, enhancing project execution speed.

📈 Strategic Growth

Expected Growth Rate

25-30%

Growth Strategy

Growth will be driven by a strategic alliance with Adani Infra (India) Limited, which is acquiring a 30.07% to 43.07% stake. This provides access to large-scale EPC opportunities within the Adani Group. The company is targeting revenue exceeding INR 4,000 Cr backed by an outstanding order book of approximately INR 15,000 Cr.

Products & Services

Civil construction and allied services for industrial, institutional, government, and residential projects, including specialized precast concrete structures.

Brand Portfolio

PSP Projects, PSP

New Products/Services

Expansion of precast concrete offerings which act as a backward integration tool for faster project delivery.

Market Expansion

Expansion into wider EPC opportunities through the Adani partnership and increasing presence in Maharashtra and Uttar Pradesh.

Market Share & Ranking

Ranked among select notable companies capable of handling high-value civil construction projects in India.

Strategic Alliances

Definitive share purchase agreement with Adani Infra (India) Limited (AIIL) for a 30.07% stake sale valued at ~INR 685 Cr.

🌍 External Factors

Industry Trends

The industry is shifting toward faster execution technologies like precast; the government's thrust on urban infra and private capex revival is driving a 19% CAGR in the sector's leading players.

Competitive Landscape

Operates in an intensely competitive and fragmented construction industry, competing with large EPC players for government and private building contracts.

Competitive Moat

Durable advantages include a 2-decade execution track record, in-house precast capabilities, and a strong relationship with the Adani Group, which provides a steady pipeline of high-value EPC work.

Macro Economic Sensitivity

Highly sensitive to government infrastructure spending and the Urban Infrastructure Development Fund allocations in the Union Budget.

Consumer Behavior

Shift toward institutional and high-end residential projects requiring rapid completion and high-quality finishes.

Geopolitical Risks

Limited direct exposure, but susceptible to domestic regulatory changes and tax regime shifts in India.

⚖️ Regulatory & Governance

Industry Regulations

Strict adherence to industrial relations regulations and internal financial controls to prevent fraud and ensure accounting accuracy.

Environmental Compliance

Implements measures to safeguard mature trees at construction sites and partners with local bodies for community-based tree plantation.

Taxation Policy Impact

Subject to standard Indian corporate tax regimes; changes in tax laws are cited as a risk factor for principal markets.

Legal Contingencies

Initiated arbitration proceedings against Surat Diamond Bourse for the recovery of stuck funds. The company also manages out-of-scope expenses for projects in Uttar Pradesh.